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Most Active Discussions

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  1. Economic Enlightenment in Relation to College-going, Ideology, and Other Variables: A Zogby Survey of Americans

    • That this “survey” passes for anything other than the ridiculous crock it is is extremely troubling. 8 agree or disagree statements, with and admitted political bias (In what way does asking questions which only challenge liberal mentalities give any kind of a useful result measured against political ideology?). What’s more, all but two of the questions could be correctly answered by simply following the “all government action bad” philosophy.

      Especially troubling are the following two questions: “Third-world workers working for American companies overseas are being exploited,” and “Free trade leads to unemployment.” The first question is WAY too open to interpretation as to the meaning of the word “exploited,” while the second should certainly be qualified by a statement either limiting it to immediate effect (assuming that this does not contribute positively to specialization, allowing new industries to develop which might suck up the surplus), or at least noting noting that it does not refer to a poorer country which signs a free trade agreement with a richer one.

      The two remaining questions, which aren’t simple “government bad” types, aren’t terrible, but any test that you can score highly on with no knowledge other than “biggest market share does not necessarily equal monopoly, government is bad, and stuff is better than it was” can hardly be said to be an indicator of economic knowledge.

      I don’t know if the authors are trying to push a political ideology as grounded in fact (an easy conclusion to reach, given the giddy, masturbatory response the study has had on arch conservative online publications such as “American Spectator”), but this survey should be fully discounted by every respectable publication as the crock it is. This is the first thing I’ve come across on Econ Journal Watch, so maybe it’s a joke publication, but if not, for shame.

    • 6 comments
    • First comment 10 Jun 2010 by N. Joseph Potts
    • Last comment 16 Nov 2015 by wargames83
  2. Adam Smith, the Last of the Former Virtue Ethicists

    • To judge McCloskey’s paper in terms of Smithian virtue, I think that she ought to be praised for bringing uncommon judgment and insight to the analysis of Smith’s mission as a moral philosopher, and vision as a social scientist. The goal of rescuing Smith from the purely economic and modern point of view is worthy and relevant still today. Her recognition of his shared perspective with the virtue ethicists of ancient and medieval times and her argument that he can only be understood through this prism are valuable and largely correct.

      However, I believe McCloskey falls somewhat short of the ideal in terms of her argument simply because the comparison cannot be stretched as far as she seems to hope. If Adam Smith was a virtue ethicist, he was a virtue ethicist of a very different kind than his ancient or medieval predecessors. And though there are important differences between Aristotle and Aquinas, it is clear that in significant ways, these two are closer to each other than either is to Smith.

      An important division between Smith and his predecessors is the way he sees virtue cultivated. For Aristotle and Aquinas, we discover virtue by examining man’s end, or ultimate purpose, and then by discovering the types of habits which will lead to the fulfillment of that end. Though these habits may be similar in kind to Smithian virtues, they are approached by way of reason rather than observation. Smith, in contrast, has very little to say about the content of man’s nature, other than that we are inclined (perhaps in universal agreement) to praise some actions and blame others. Smith seems to remain agnostic about whether this is an end in the mode of Aristotle, or merely a consequence of natural forces.

      Smith’s departure from Aristotle, and his adoption of enlightenment epistemology, makes McCloskey’s argument slightly misleading. And this does become especially apparent, as the previous comments have pointed out, when she attempts to make a place for hope and faith in Smith’s enlightenment virtue system. Here I agree with Steve Kunath that McCloskey is mistaken in her appeal to Aquinas. For to Aquinas, faith and hope are very specific theological virtues, both forward looking, and both connected specifically with man’s end in an exclusively Christian sense. They are not the secular-friendly virtues McCloskey would make them.

      And it is only in this very theological sense that faith and hope can exist as “primary colors,” as McCloskey defines Smith’s five essential virtues. Brian Bedient is right is to classify McCloskey’s versions of faith and hope as secondary virtues. The hope for a better future that Smith envisions is substantially different from Aquinas’ hope for the mercy of God. While I think Smith does indeed have every intention of recommending virtuous existence (rather than merely providing a descriptive account of human action), I believe that faith and hope as they existed in earlier virtue ethics have no place in his work. The faith and hope which appear in McCloskey’s article are of an entirely different kind, and do not need to be added to Smith’s list of primary virtues.

    • 6 comments
    • First comment 22 Sep 2010 by Steve Kunath
    • Last comment 14 Nov 2012 by Todd Peckarsky
  3. Mankiw vs. DeLong and Krugman on the CEA’s Real GDP Forecasts in Early 2009: What Might a Time Series Econometrician Have Said?

  4. Religion, Heuristics, and Intergenerational Risk Management

    • Though I disagree with its economic approach, this is a perceptive article. Much of religion is about teaching humility: I am not God. We are not even gods. And, religions say, this is true even if you’re very smart and even if you’re a king. The virtue of humility is express in Christianity, but it’s implicit in a lot of religions. And it enters through Providence—- natural laws and the ordinary workings of the world—- as well as directly. THink of Rudyard Kipling’s poem, The Gods of the Copybook Headings, http://www.kiplingsociety.co.uk/poems_copybook.htm (“copybook heading” means a wise, often trite, sentence used for children to practice their handwriting).

    • 5 comments
    • First comment 30 May 2014 by Tom Garnett
    • Last comment 15 Aug 2015 by G. Ashton
  5. Advanced Placement Economics: The Good, the Bad, and the Ugly

    • I totally concur with this article. I had three kids of mine go through AP economics, both micro and macro. I was appalled – the material was 30 years behind the times, both micro and macro. AP economics is confirming the worst stereotypes of what economics is about. And it was boring, boring, boring, even to me.

    • 4 comments
    • First comment 25 Jan 2011 by Paul Johnson
    • Last comment 16 Mar 2011 by David B
  6. The Ideological Profile of Harvard University Press: Categorizing 494 Books Published 2000-2010

    • Quick question about cause and effect… I’m sympathetic to the argument here, and the social psychology literature demonstrates, quite well, that we read things more critically when they run counter to our own ideological perspectives, so clearly conservative books would have a more difficult time in the peer review process. However, I’m wondering if Harvard could defend its publication list by arguing that the number of conservative books published is actually proportional to the number of conservatives in academia. I’m noticing, for example, that some of the numbers here seem to mirror data about the number of conservatives in each discipline. So if field X is comprised of 10% conservatives, and 10% of HUP’s publications in that field fall right of center, couldn’t they argue that conservatives have the same chance of being published as liberals? Is there any way to see a sample of submissions and or rejections?
      April Kelly-Woessner

    • 4 comments
    • First comment 24 Jan 2011 by Hal Luft
    • Last comment 16 Feb 2011 by Milo Schield
  7. The Liberty of the Ancients Compared with that of the Moderns

    • Constant’s speech flows effortlessly, enumerating the distinctions between ancient and modern conceptions of liberty. Ancient liberty “consisted in exercising collectively, but not directly, several parts of the sovereignty” and “with this collective freedom [came] the complete subjection of the individual to the authority of the community” (66). Under ancient liberty, “[a]ll private actions were submitted to a severe surveillance” and “[n]o importance was given to individual independence” (66). Modern liberty exists in a system of representative government, rather than direct participation. Modern liberty is “the right to be subjected only to the laws” (66). Constant summaries the key distinction nicely: “[A]mong the ancients the individual, almost always sovereign in public affairs, was a slave in all his private relations” (67). “Among the moderns, on the contrary, the individual, independent in his private life, is, even in the freest of states, sovereign only in appearance” (67). A paradox seems to emerge with respect to ancient and modern liberty. While we want modern liberty, it is still necessary to keep ancient liberty in the background. “The danger of modern liberty is that, absorbed in the enjoyment of our private independence, and in the pursuit of our particular interests, we should surrender our right to share in political power too easily” (70). Constant warns against putting too much faith in authority figures. He pleads that “we must not leave it to them. No matter how touching such a tender commitment may be, let us ask the authorities to keep within their limits. Let them confine themselves to being just. We shall assume the responsibility of being happy for ourselves” (70). It seems that the dangers of modern liberty are very real and present today. Individuals often look for the government to be more than just. The government is regulating personal happiness through various policies that go against liberty. It’s a slippery slope and Constant would call for us to take responsibility.

    • 4 comments
    • First comment 15 Apr 2011 by Ariel Nerbovig
    • Last comment 06 May 2011 by Stephanie Myla Helmick
  8. Entrepreneurship and Islam: An Overview

    • Say, you need 100% of underlying good for Islamic finance. What about 90%? 80%? How low do reserves go before it breaks Shari’ah law? Does the first dollar lent out of monetary deposits rather than lent on the back of real world collateral render the financial institution as counter to Shari’ah?

    • 4 comments
    • First comment 31 May 2014 by Eric Rasmusen
    • Last comment 03 Jun 2014 by Nathan W
  9. Preference Falsification in the Economics Profession

    • When I was a cadet in my senior year, we had to take a class with the senior officer in charge of the ROTC department. One of the concepts that I remember him trying to drive home was that we were preparing to enter a “profession”. At the time it struck me that he was grinding some sense of inadequacy, looking for a word that would make his own career more significant in the way some janitors want to be called “sanitary engineers”. However, two elements of his definition of a profession have remained with me (I’m sure there were more). In the colonel’s definition, a career field was a profession if it had a body of knowledge and an ethical code of conduct. Merely having an expert knowledge of a field made you a technician, not a professional. The ethical code of conduct instructed you on how you were to use your expert knowledge, and provided purpose for professional practice.

      In the quote above, Davis is referring to what the important work of the economics profession is, rather than what is important to be successful in the profession in this particular quote, but in an ideal world, the latter should flow from the former. I believe many people come to the social sciences with a desire to make society better (we may not all agree on what “better” means, but that is a separate issue). The dissatisfaction I read, overtly and between the lines, is that the “profession” of economics, in its pursuit of the air of positive science, has lost its ethical code of conduct and has devolved to a technical career field. The statement, “The economics profession is a bad joke. More and more economists are saying less and less to fewer and fewer people. And they conceal their vacuity in abstruse language and mathematical formulae” (p. 364), strikes at the heart of the loss of a professional ethic in the field. What is the ultimate purpose of economics but ultimately to increase society’s understanding of the economy and thereby guide policymakers to make effective policies? This does not necessarily mean that a lay person should be able to pick up an economics journal whose audience is intended to be professional economists and understand it fully any more than a lay person should be able to pick up a copy of the New England Journal of Medicine and expect to fully understand it. Every profession must have an introspective element that works to extend the professional knowledge, and a means of communicating that new professional knowledge.
      Davis paraphrases respondents who say collectively “The bifurcation of the economics profession into researchers, teachers, and policy-makers has gotten worse and the number of individuals who are respected for contributions in all three areas gotten fewer and farther between” (364). I am not sure this is actually a problem – it sounds like a matter of comparative advantage for the individuals involved. We are after all the field that promotes specialization of labor. The real problem seems to be that the economics field has been overwhelmed by its pursuit of the professional body of knowledge, and in particular a very narrow portion of the body of knowledge as defined by the use of mathematical methodology, and has lost its commitment to the ethic of betterment that defines social science practitioners as professionals rather than as mere technicians.

    • 3 comments
    • First comment 21 Apr 2010 by Jon Goldstein
    • Last comment 22 Apr 2010 by Shawn Reed
  10. A Life among the Econ, Particularly at UCLA

    • A wonderful remembrance! Although not a major in Economics, I had Alchian for Econ 101 (for non-econ majors?) in the mid 1950s, and a year or two later, a grad seminar with Allen (and someone else) on Internat’l Econ Development. Also, had Hildebrand for K. Marx econ. With the help of Prof Allen’s retrospective, I am now inclined to even greater appreciation than at the time—-partly for their inculcation of an economic perspective but mostly for their character.

    • 3 comments
    • First comment 08 Sep 2010 by morrie goldman
    • Last comment 17 May 2011 by josil
  11. Individualism: True and False

    • Using the contrast between two philosophies that both have been referred to as individualism, Hayek outlines many of the usual justifications for a government and an economic system built around precepts of individual liberty. He tracks the intellectual history of the word “individualism”, claiming that what he calls false individualism leads inevitably to socialism and collectivism. He praises true individualism as worthy because it produces the most desirable results; false individualism has been wrongly associated with it and thus usurped its meaning.
      Hayek argues that the basic principle dividing the two philosophies is their differing conceptions of human nature. False individualism is more or less an overconfident humanism, while true individualism freely admits to human foibles and limitations. Thus, people who subscribe to false individualism have inflated expectations that men can rationally design the perfect society. Hayek argues for property rights, limited government, free exchange of goods and services, and the price mechanism built on the idea that men are fallible. The order in society develops unintentionally from the choices that free people make. Hayek’s defense of a classical liberal society on these grounds is utilitarian and compelling.
      It is somewhat surprising the particular battle lines Hayek drew. He equates true individualism with the Anglo-American culture and its associated thinkers, like Adam Smith and Hume, while pointing to French thinkers following in the tradition of Descartes as the primary source of false individualism. Hayek claims that German culture has yet another sense of the word individualism, which is the rejection of historical tradition as a source of authority over one’s behavior. It is an interesting division but a little difficult to believe that nationality follows the divisions between the intellectual traditions so simply.
      The most surprising point in the essay is Hayek’s effort to demonstrate that liberty and cultural traditions are consistently compatible. Cultural norms develop from a spontaneous order that reflects the process of the market. Hayek argues that respect for naturally evolving norms, rather than designed ones, encourages respect for the power of spontaneous order to produce the most desirable outcomes. His assertions seem to match the historical outcomes of the French Revolution, which ended with a military dictatorship, and the American Revolution, which resulted in a system of government with a strong presumption of liberty. The former tried to radically remake the society but the latter was simply an assertion of principles deeply ingrained culturally.

    • 3 comments
    • First comment 22 Sep 2010 by Tony Quain
    • Last comment 10 May 2013 by Matt
  12. "The Two Faces of Adam Smith"

    • Vernon Smith seeks to solve the Adam Smith problem and reconcile what seem to be two inconsistent views of human nature in Wealth of Nations and The Theory of Moral Sentiments. In Wealth of Nations, Smith’s invisible hand theorem proposes that it is not from benevolence, but rather “the propensity to truck, barter, and exchange one thing for another” which drives our behavior (1776; 1909: 19-20). In The Theory of Moral Sentiments, Smith declares that there are “some principles in… [human] nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it” (1759; 1976: 9). Vernon Smith asserts that these two views are consistent if we recognize a “universal propensity for social exchange” (3). He proposes the following behavioral axiom: ““the propensity to truck, barter, and exchange one thing for another,” where the objects of trade I will interpret to include not only goods, but also gifts, assistance, and favors out of sympathy, that is, “generosity, humanity, kindness, compassion, mutual friendship and esteem” (Smith 1759; 1976, p. 38)” (3). Vernon Smith then proceeds through historical, psychological, and experimental evidence to support this theory. Vernon Smith offers a very convincing and creative solution to the supposed Adam Smith problem. He makes crucial distinctions between reciprocated and non-reciprocated exchange. However, Vernon Smith seems to neglect the importance of non-reciprocated ethical behavior in Adam Smith’s work. Hanley (2010) elaborates on the distinctions between Adam Smith and Vernon Smith. He also points to divergences in opinion on intended beneficence and social vs. unsocial behavior. Vernon Smith asserts that Adam Smith’s explanation of beneficence is “utilitarian” and argues that it arises “from the expectation of reciprocal benefits” (17). This egoistic view of man may not fit neatly into Adam Smith’s conception which encompasses broader views on ethics and virtue.

    • 3 comments
    • First comment 25 Apr 2011 by Echo Keif
    • Last comment 06 May 2011 by Steve Kunath
  13. Economic Enlightenment Revisited: New Results Again Find Little Relationship Between Education and Economic Enlightenment but Vitiate Prior Evidence of the Left Being Worse

    • People believing firmly in free market and voluntary exchange efficiency (just missed some fluctuations in Q.16 and negative externalities in Q17) are wrong and “Unenlightened”.
      People believing after USSR economy TOTAL failure and China transition to market economy that voluntary transactions are inefficient and only Gosplan could succeed to organize it are right and enlightened? Are you sure Q16-17 really helpful?
      BTW, conservatives actually able to count negative externalities.
      Q14: say Farmer A hired 5 immigrants from the country w/o tradition to respect property and human life, dignity etc. Let Farmer A saved for a Seazon $100K his costs (taxation, salary) and shared part of $100K among his product consumers. So, public wealth increased $100K. OK, now, close to the end of the Seazon (game almost over, last move of the gamer could be very unpleasant) this immigrant workers grabbed and killed farmer B and raped farmers’ C daughter and escaped to Mexico.
      Public losses counted say $5 million at least. So, conservatives actually count negative externalities, some libertarians so stubbornly ignore (Caplan vs. Friedman):
      http://econlog.econlib.org/archives/2008/06/milton_friedman_10.html

    • 3 comments
    • First comment 17 May 2011 by rihir akidan
    • Last comment 28 Apr 2012 by Moshe
  14. The Invisible Hand of Jupiter

    • I hope to add to, and hopefully not just echo, what Erik has already pointed out.

      It would seem that Smith’s use of the “invisible hand” allegory in both The Theory of Moral Sentiments and The Wealth of Nations is used to illustrate the edict of nature and society that direct economic activity. Whereas, in the History of Astronomy the “invisible hand” is used to explain the unexplainable— the events that are beyond the natural laws of the secular world. On the surface, the “invisible hand” reference takes on a slightly different connotation in the three Smith pieces mention above. In The Wealth of Nations it can be interpreted as the natural laws that manage markets and society; in The Theory of Moral Sentiments it can be seen as a divine set of universal rules directing a just and virtuous society; and, in the History of Astronomy it can take on the role of a divine authority overriding these rules and laws. I believe, as I deem Erik does, that the latter use of the “invisible hand” also shows up in The Theory of Moral Sentiments and The Wealth of Nations. Consider the following few lines from The Theory of Moral Sentiments: “The rich…only consume little more than the poor, and in spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose from the labours of all the thousands whom they employ, be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life…had the earth been divided into equal portions among all its inhabitants…”. Although “selfishness and rapacity” would seem to be characteristics that would not direct society in the way of justice or virtues, the industrious individual’s “natural” penchant to serve his own interest ultimately benefits society—the mean may not appear agreeable, but the end is. Is this “natural” penchant toward “selfishness and rapacity” not assumed to be put in place by a precocious, divine authority? It certainly can be interpreted that way. If we except that the “invisible hand” is the work of a higher authority, who has directed the butcher and the brewer to act in their own self interest, and who has provided society with nature ethics and virtues to govern themselves, and who makes it “lightening” and “thunder”, then the metaphor is consistent in all three of Smith’s works referenced above. Since this heavenly intention or intervention is not observable, Smith does not bother with a speculative explanation, simply calling it the “invisible hand”.

    • 3 comments
    • First comment 15 Oct 2011 by Pavel Kuchař
    • Last comment 15 Nov 2012 by Francis Conlon
  15. Can ‘Religion’ Enrich ‘Economics’?

    • Hi, T. My wife’s family moved away from Winnipeg, so I haven’t been back for quite a few years now. I enjoyed your article, which makes an interesting pairing with mine for comparison of where we agree and disagree. You make me feel I should read some of Whately’s work.

      I like the idea that the Invisible Hand is evidence of God’s Providence, similar to the wonders of the human body. It is a natural process, to be sure—- but isn’t it wonderful that we live in a world where the Invisible Hand works? It’s a bit like the physicists’ Fine-Tuned Universe. Your article made me realize that William Paley, of Watchmaker fame, wrote a book about “social science” as well as one about natural science. His Evidences of Christianity (http://www.gutenberg.org/ebooks/14780) is about arguments from history and sociology, e.g. why were the early Christians so willing to suffer persecution if the Gospels were falsehoods, and why did Christianity spread so much in the world? Economics can try to address those, just as evolution tries to address the Watchmaker, and, indeed, I’d count Rodney Stark as an honorary economist.
    • 3 comments
    • First comment 30 May 2014 by Eric Rasmusen
    • Last comment 10 Jun 2014 by Nathan W
  16. Education Premiums in Cambodia: Dummy Variables Revisited and Recent Data

    • John, I do not believe you understand my point. Computed as discrete changes, which is what you do, the percentage difference of the premia (college versus high school) is not equal to to the difference of the percentage premia (college versus base minus high school versus base). You are implicitly using a false assumption; it is the same false assumption made by the Mexican government in the example I cited: that the difference of the percentage changes (+50 – 33.3) is the percentage change of the difference. It causes you to greatly overestimate the education premium.

    • 3 comments
    • First comment 30 Sep 2015 by Ronald Michener
    • Last comment 30 Oct 2015 by Ronald Michener
  17. Ideology Über Alles? Economics Bloggers on Uber, Lyft, and Other Transportation Network Companies

    • Hmmm. I entirely agree with the premise of this article: Uber is obviously an economic improvement and all efforts of the incumbent cartel to stymie it should be resisted. Admirably, all of the economists polled, regardless of political orientation, agreed. And indeed it would be nice if some of the more progressive of them spoke up about this. And any article taking Krugman’s ideological blinders to task is worth reading.

      But all that said, it seems that faulting left-leaning economists for remaining silent about Uber on their blogs just goes too far. Maybe they are afraid of ideological reprisal and so keep quiet. That would be shameful.

      But maybe they just feel that they have nothing particularly important to add to the economist consensus on Uber? That seems quite possible. For among the silent, are such as David Friedman, Greg Mankiw, Robin Hanson, and Steven Landsburg.

      Would anybody suspect any of these of being afraid of left-wing political reprisals for as anodyne a policy as supporting Uber? Any of their readers can see them voluntarily waving much bigger red flags at Progressive bulls on a frequent basis.

      In fact, their silence is some evidence that they just agree with the pro-Uber consensus. For any of these worthies had convinced himself that for some curious, clever reason Uber was the rare example where they oppose liberalized markets, they would have been sure to blog about it.

      So, if we can attribute the silence of “conservative” econ bloggers to blameless reasons, why not give those on the other side the same courtesy?

      That said, influential progressive Econ bloggers should be particularly encouraged to voice their support for Uber, even they have nothing novel or clever to add. A few such posts would do a great deal more for the common cause, than a hundred eloquent posts by econ bloggers on the other side of the spectrum preaching to the choir.

    • 3 comments
    • First comment 30 Sep 2015 by Michael Maloney
    • Last comment 24 Oct 2015 by Carl Edman
  18. Faculty Voter Registration in Economics, History, Journalism, Law, and Psychology

    • What is the null hypothesis here? You appear to be assuming that absent the pressures you describe, faculty would resemble the US population. But it’s well known that, other things equal, those with more education tend to be Democrats.

      I suggest a better comparison would be with scientists, who have high levels of education but don’t in general need to make their political views known at work. According to a Pew survey of AAAS members from 2009, 55 per cent of scientists are Democrats and only 6 per cent are Republicans.

      So, a parsimonious hypothesis is that faculty in the disciplines you study are a representative sample of highly educated (PhD +) Americans in general.

    • 3 comments
    • First comment 02 Oct 2016 by John Quiggin
    • Last comment 07 Oct 2016 by AlanTan
  19. The Social Science Citation Index: A Black Box—with an Ideological Bias?

    • After a Google keyword search of “Commentary Magazine” and “Social Science Citation Index,” I found this article and was introduced to EJW. The bias Klein and Chiang illuminate, exists not only in the slant of the SSCI journals which make and break careers, but also the themes and questions addressed at major conferences and their panels. (Just take a look at the CfP for next year’s APSA annual.) Now finishing up a PhD and finding the same problem on the job market, the research backgrounds often asked for (my area is IR/ IPE) also come from left field. Rather than become disheartened, this state of affairs increases my resolve to follow and intelligently express my conservative convictions in the face of single minded institutionalized opposition. I love a good fight and know the truth will prevail. I’d rather be right than loved, although it would be nice to be both.

    • 2 comments
    • First comment 01 Nov 2011 by Alex Littlefield
    • Last comment 11 Feb 2013 by Alex Littlefield
  20. Adam Smith and Conservative Economics

    • Here Emma Rothschild examines the various schools of interpretation of Adam Smith’s works that emerged shortly after his death. Specifically, she looks at three incidents where Smith’s ideas were used to support a particular policy or school of thought. Starting with the idea that Smith was, at least in a way, an indirect supporter of the French Revolution movement, she then discusses how an early biographer attempted to fundamentally redefine Smith’s understanding of freedom, Her final example shows how certain philosophers and statesmen in England attempted to confirm their own policies and positions by making reference to Smith and saying that his writings were in line with their policies.

      At this point an individual could justifiably ask what all the fuss is about. Does it really matter if Smith would have been a supporter of the French revolution, labor laws, or any other piece of trivia a historian is trying to suggest is important? They might continue and say that Smith opened up the door to modern economics and it is really not important to immerse oneself into the squabbles of the late 18th century. I answer, however, that it does matter and that Rothschild’s piece allows readers today to better understand the state of the world we now find ourselves in. Generally, when Adam Smith’s name is thrown around it is used to talk about the early development of the free market system and economics. If the average individual, and I daresay the average economist, is pressed to provide more details about who Adam Smith was and what his contributions were, they might make vague references to The Wealth of Nations and then completely skip over the career of Smith or even his earlier work on moral sentiments. The general lack of knowledge about Smith’s corpus or about even the general orientation of his work can lead to contradictory interpretations and is in the end what Rothschild’s essay points to.

      Economists, like individuals in many other fields, operate with many assumptions about how individuals operate. The modern turn has brought in primarily utility or Paretian ideas of maximization. While this move is justifiable at least from the perspective of making problems more tractable it fails to make a strong connection to the ideas of the individual that Smith would have assumed. Smith spilled much ink in the Theory of Moral Sentiments on the motivations and dispositions of the individual. Today there are, just like Rothschild’s examples, different schools of thought within the academy on how to correctly interpret Smith and apply his principles to current problems. The fact that these differences exist must be pointed out and once identified a real discussion must take place to understand what Smith is really saying, whether what Smith has said fits with our current knowledge, and only then can we really come to an understand of what liberty is and how it should be enshrined in our civilization. Rothschild’s essay provides a good first step in that direction.

    • 2 comments
    • First comment 07 Oct 2010 by Steve Kunath
    • Last comment 19 Oct 2010 by Brian Bedient

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